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Forex Trading, Market News & Technical Analysis

On Friday, Statistics Canada showed that labor market was surprisingly robust in May, with 77,000 jobs created, much higher than the 15,000 analysts’ forecast. For the first 5 months of year, Canada has created 185,000 full-time jobs that is well above the pace of 73,500 in 2016 and currently best year since 1999. The national unemployment rate ticked higher to 6.6%, as more people entered the job market.

The Canadian dollar remains heavy as oil prices continued to slide for a third consecutive day. The loonie was also under pressure following President Trump comments. He stated, “What Canada has done to the US dairy industry is a disgrace, the same is true of US timber industry. The US President also noted that they need to get to the negotiating table very quickly with Canada.

The Canadian dollar rallied as oil prices rallied and made a nine-day high after a smaller-than-expected build in US inventories. Oil, Canada’s largest export also benefited from some technical buying as prices surged after recapturing the 200-day SMA.

The Bank of Canada kept interests rates unchanged at 0.50% and highlighted subdued growth in wages and hours worked continue to reflect persistent economic slack in Canada, in contrast to the United States. The BoC also noted recent data on the global and Canadian economies have been consistent with the Bank’s projection of improving growth, as set out in the January Monetary Policy Report (MPR). In Canada, recent consumption and housing indicators suggest growth in the fourth quarter of 2016 may have been slightly stronger than expected. However, exports continue to face the ongoing competitiveness challenges described in the January MPR.

The main event for Monday was the meeting between President Trump and Prime Minister Trudeau. The meeting was friendly as President Trump avoided answering the question of whether or not the northern border is less secure because of all the refugees Canada has accepted. Mr. Trudeau also declined to comment on Trump’s executive order restricting immigration.

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